The Hawaiian gazette., 1887-02-15

falling to pay any part thereof is liable
to be made bankrupt.
This paragraph from the Judges
charge must be taken in connection
with the evidence. As stated by plain
tiffs' counsel "the evidence showed
that Afu had borrowed from plaintiffs
January LIST, 1886, $500, giving two
notes payable in one and two months,
and that March 31st, he borrowed
further sum of $500, giving note
payable in one month, all without
grace, and that during the first week
in April, all these notes being then
unpaid and due, or overdue, Afu made
a further loan from plaintiffs of SITS,
to meet pressing demand, part of
which he paid, and then arranged to
give this mortgage. This mortgage,
executed May LIST, is for 81, 200, in
Guiding SITS, loaned as above 1t
includes all the merchandise and
stock in trade, fittings, all the book
debts and evidences of debt, ETC., of
the mortgage, all the new stock which
might be purchased, whether depos
tied on the mortgagee's premises or
elsewhere. 1t is to secure the said
$1,000, and also such further advances
as may be made. 1t provides that
until full payment, the mortgages or
their assigns may control and conduct
the business and place a person in
charge for that purpose. The pro-
ceeds are to be applied:
a. To the reduction of the amount
secured.
o. To the purchase of new stock.
49, To the discharge in whole or in
part of the claim of such other credit
ors as the mortgages may nominate,
but provides that they may please not
to pay any other claims until the
whole of the secured claims shall be
extinguished. Foreclosure may be
made by public auction or private
contract, one month from date. 1t
then appears in the evidence that the
mortgages placed the mortgagor in
possession for them, or rather contin
ued him in possession.
1t is transparent from the contents
of the mortgage and from the evil
dence cited, that Afu was insolvent
and had committed acts of bankruptcy,
and that the mortgages had notice.
They take notice of there being other
creditors by the statement of the mort
gage.
The only assignments of property
by an insolvent which the law will
sustain are those upon good consider
alton to a bona tide purchaser, hav-
ing no reasonable cause to believe
him to be insolvent. The plaintiffs
are very far from this position, and
the Court should not have charged
otherwise than it did.
81 The third exception is to the
refusal of the Court to charge that the
clause in the deed permitting the
mortgages to discharge from the
proceeds of the mortgaged goods be-
sides the debt to themselves such
claims of other creditors as they
should elect to pay, and to the in
given that the deed, being
a transfer of all Afu's stock in trade
and property was in itself an act of
bankruptcy and void as against the
assignee.
1t does not seem necessary to say
much about this exception. The sec
ond exception having been sustained,
the third instruction asked for could
not affect the result. The whole mort
gage was held to be void under the
circumstances of this case. 1t would
not support it to find that any partic-
ular clause might not be fraudulent
per Sc. 1t was strictly within the pro-
vince of the Court to instruct that I'M
der certain facts, not controverted, and
being the plaintiffs evidence, the
mortgage was void, and the question
should not have been left to the jury.
Thus
The exceptions are overruled.
Ashford & Ashford attorneys for
the plaintiffs; w. Austin Whiting for
the defendants.
Honolulu, Feb. s, 1887.